WONO claims to have a 1–5% deal commission. So, what are the cost savings? Why won’t we take 20%. like Airbnb? Why do companies like Airbnb charge such large commissions? Our accommodation advisor Benedict O’Leary, who worked for more than 3 years as a business development manager at Booking.com, explains everything.

The first question to ask is: what is commission?

Commission is the fee used to facilitate transactions online. It is the fee charged by car-sharing, work-placement or home-sharing companies to market the product online to match product (Vendor) with customers (Users). The idea of the commission fee is that behind any website there is a considerable back-end of people who work together in order to build the website and therefore it needs to cover its operating costs.

This covers the whole range of tasks, from programming to HR, from legal to IT helpdesk. If any company wants to stay up-to-date then there needs to be investment into the website so that it stays relevant and functional.

We can break the commission costs into the following areas:

1.Operating costs (offices, staff, recruitment and retention)
2.Marketing and advertising (the huge sums paid for SEO)
3.Legal & Regulatory (operating in a complex multi-territory legal & regulatory environment).
In the next article we’ll discuss operating costs and how can we reduce them at WONO.

Benedict O’Leary